Eland Oil & Gas PLC (AIM: ELA), an oil & gas production and development company operating in West Africa with an initial focus on Nigeria, is pleased to announce that its joint-venture subsidiary Elcrest Exploration and Production Nigeria Ltd, has successfully completed sidetrack drilling at Opuama-7.
The Opuama-7 sidetrack encountered both D1000 and D2000 sands as expected with a total of 77 feet of good quality net pay. Over 60ft of the D2000 sands have been successfully perforated and the well is currently being completed and hooked up so production can commence imminently, with gross production flow rates expected to be in line with previous guidance of 5,900 bopd. The D1000 sands will be perforated at a future date to maintain the production rate. The Company will make a further announcement once an initial stabilised production rate from the Opuama-7 well is achieved.
In light of the success of the Opuama-3 recompletion in 2016 and the positive results of the Opuama-7 sidetrack, the Company is bringing forward its plans for infill drilling on the Opuama Field, taking advantage of having the rig in Opuama and to accelerate production growth through the existing production infrastructure. The Company and its partner NPDC have elected to retain the OES Teamwork drilling rig to drill an Opuama infill well immediately. Whilst Opuama-7 is being hooked-up for immediate injection into the Opuama facilities, and OML 40 export line, the rig will mobilise to the Opuama-8 drill site. Opuama-8 to is expected to produce at an initial gross rate of between 5,000 and 7,000 bopd. Targeting the D4000 and D5000 reservoirs to a depth of approximately 8000ft.
Production performance from OML 40 remains strong, with average production from July 1st to 20th October of circa 12,000 bopd from Opuama-1 and Opuama-3. We are delighted to report that uptime during the period is running at 99.0%, the most consistent performance to date from OML 40.
We are also pleased to announce that a lifting of 171,000 barrels of oil took place in September at an average price of $54.66 per barrel, generating revenues of $9.3 million. Payment for this lifting is due by the end of October.
George Maxwell, CEO of Eland, commented:
"Elcrest's on schedule completion of the Opuama-7 sidetrack is an excellent result for the Company, and continues to show the strong planning and operational capability of our team. I look forward to updating the market on what we expect to be a further significant increase to the Opuama production base"
"The drilling of Opuama-8 has the potential to add further material production of an initial 5,000 to 7,000 bopd with strong revenues in a short time frame. Following Opuama-8, the OML 40 JV intends to drill a further one or two infill wells on Opuama. Together with our partner NPDC, the Company has tripled production form Opuama in the last 18 months and following a successful Opuama-7 and infill campaign is expected to double production again by the end of Q1 2018. We remain committed to developing OML 40 to its full potential and optimising our attractive acreage position in a capital efficient manner and look forward to the re-entry and completion of Gbetiokun-1 in 2018."